Money Merge Account?
Real Estate Investor · Las Vegas, NV · Member since 2008 · 1k+ posts · 447 votes
Has anyone come across the Money Merge Account (MMA), which is being marketed by United First Financial?
The idea is to use a HELOC to prepay your first mortgage by timing additional payments. It is supposed to be better than just paying additional principal by using the program to time additional payments. The company claims that the program is used extensively in Australia with great results. The concept certainly isn't new but the idea is the benefit of computerized timing. To me it just seems like a way to sell an expensive program that the average person will not follow. Am I missing something? I would love to hear from others who may know more about this program.
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There is no need to pay the fee. An individual can accomplish the same using a HELOC and a 1st mortgage plus depositing all their income into the HELOC account.
I have a One account in the UK.
I have see the presentation for a mortgage product that is in the US but backed by an Australian bank. They charged no fee for setting it up other than the costs of a new 1st like most any other 1st mortgage product.
There are multiple ways to get the job done.
The fee is a sales charge to cover the folks who are promoting the fee based solutions. Like most things in the marketplace there are some programs that have higher front loaded charges and there are programs that do not. The sales people focus on the commission. The savvy investors know how to avoid the inflated charges.
Questions?
The math is very simple. Almost anyone who invests in RE can figure it out with a calculator. The paying off the loan early by X years or the interest savings of Y comes entirely from having less debt outstanding. There is no magic. The feeling of magic is because people do not think about the cost of borrowing vs. the income they get on savings.
John Corey
PS. For anyone who needs a detailed explanation just post the questions. I will either answer in the forum if there is general interest or we can use email. Save your money and buy a better calculator if the math is difficult right now. I can show you how to run the numbers once you can use the calculator.
PPS. The biggest benefit to an investor is not the early pay down of the loan. If is the idea that a HELOC lets you do cash deals.
One person already contacted me. We has an online chat session and they walked away pretty confident as to how to make it work. With the $3,500 that they saved it is possible to take 1 year off their loan even if they never do anything else.
So, send me a PM and we can then trade email. A few emails or an online chat is all it should take.
It is best if you have your mortgage details plus a calculator when reviewing the info.
John Corey
To start off I have to say I've really enjoyed the debate here. I've been researching this program for some time now, and generally I just find people saying its a scam, and they don't even know how it actually works. So to have found a real debate is refreshing.
The question I have from the debate is that it was said that most of the time nobody follows through with a financial planners plan. Yet with the mma, not only are people following it, but supposedly 90% of the test people were ahead of schedule. Shouldn't that be given some merit. I agree that on paper a financial planner could probably get much better numbers, but if they aren't actualized then where is the value?
For those who want to do it on their own congrats. You are wanting to make a change. Just make sure you can follow through for the next fifteen years on your own.
Currently our nation is in a negative savings rate, the dollar is dropping as we borrow two billion from foreign nations every day, and we were just hit with a terrible housing bust with many people losing their home. If somebody wants to try and make a change in our current direction by offering actualized results I think that $3500 is a very small price tag.
I am very skeptical about this united first financial mma program but my wife wants us to try it because our son inlaw who became an agent is convincing her it will help pay off our mortgage in 4.5 years. We have a 15 year mortgage with 10 years left .
We do have a HELOC and i was wondering how can we do this program ourself without paying the 3500.00 overbloated fee.
I would also like to know how to do this without the fee. i have evrything else setup as far as the HELOC goes any info would be greatly appreciated.
Thanks
I really appreciate this discussion! I have read alot as well about MMA and it is nice to read intelligent debate. I am not yet a customer, but I am seriously considering purchasing the program. I have 3 thoughts to contribute.
1. While I understand REI's argument that anyone could do this on their own, I agree with Jamie that it really does come down to knowledge and discipline. Some have the financial knowledge and discipline to do this on their own, but I think we can all agree that most don't. Ask any financial planner and it has already been stated above, most people just don't follow the plan of action set up for them to acheive their goals. I can personally admit I do not have the discipline. This program I believe could help me become disciplined.
2. I am more or as knowledgeable as any average American who does not work in the financial field when it comes to being smart with money. So could I sit down and eventually figure the numbers out, probably. But that is time I do not have or would not want to use for that purpose.
3. We live in the age of everything visual. TV...Video Games...Computers. We are a visual society, period! That is why I believe this program could be very powerful for me and many others, because it is visual. I can see where my money is going and how my financial decisions are affecting me and my biggest investment, my home. That, again, I believe will help create discipline.
Thoughts?
I've done quite a bit of research on this MMA and the competitors out there. The MMA does work, but personally I think the $3500 "retail" fee is a bit steep.
There are a few others software programs that teach the same thing and run the same calcs and analysis for you. One costs you about $1700, and another is only $99.
One's call the Equity Genie and the other one is MaxyourMortgage or something like that.
I don't work for any of these companies- this is just my semi-objective opinion on them.
They DO work faster than just paying more every month/ year, etc. on your own. But you need-
min 680 FICO
min 25% LTV on the property.
And some positive monthly normal cash flow.
For it to work.
Thanks,
Ken
[SPAM REMOVED]
There are plenty of people charging to do this but the person that developed it is from Australia and he has a book out now that you can purchase. The name of the book is "How to own your own home sooner" and the author is Harj Gill. There are banks here that are familiar with what needs to be done. I know somebody who is doing it and he says it works great.
Joined this community because people were talking about a company I've been working with for a year... United First Financial.
I posted some 3rd party information, namely that the company, and our mortgage acceleration program, had been given accolades by several financial and real estate publications, including receiving the EDITORS CHOICE AWARD by "Personal Real Estate Investor" magazine (March/April) and "Outstanding Company of the Month" by Broker Banker magazine (Nov, 07).
Unfortunately the "gentleman" that runs this site apparently considers posting positive information "spam" and removed it.
I could certainly understand his actions if I had posted on some OTHER thread, but I take exception as my post was not at all off-topic, in fact it was totally ON topic since several folks here ASKED for more information on United First Financial. I simply provided it, and a way to get more.
Is it possible that this forum is being selectively edited to create controversy because that "sells?"
Don't folks here agree that 3rd party information from a financial/real estate publication is much more credible than anything that I could write myself, given that I am only a client and an agent, and can only write from my own perspective?
Yes I did invite people to email me if they wanted the article (I won't do that this time), is that what made it "spam?" Or is it just "spam" if it is of a positive nature?
I think it is safe to assume that savvy intelligent people are going to want to research something beyond the bounds of postings on the internet. Is there really something wrong with providing information that there ARE outside resources so that people can get a copy of those magazine articles and see what industry experts are saying, rather than relying on assumptions and opinions by people unfamiliar with the program?
In Josh’s defense, there are rules about what can be posted. If you read the rules you will see that it is clearly stated that you cannot post any solicitations or promote any product until you have 10 posts. That is done to protect the site from spammers by only allowing people who have made a real contribution to the site to post here. You haven't been singled out, the rules apply to everyone. Make a real contribution and you will be allowed to post. The only contribution that you have made to date is to promote something that you sell. That system works very well and the site is pretty much spam free.
In regards to the Money Merge Account, the only people who heartily endorse or defend the program also happen to be selling it. That’s not exactly objective.
8)
I posted some 3rd party information, namely that the company, and our mortgage acceleration program, had been given accolades by several financial and real estate publications, including receiving the EDITORS CHOICE AWARD by "Personal Real Estate Investor" magazine (March/April) and "Outstanding Company of the Month" by Broker Banker magazine (Nov, 07).
Unfortunately the "gentleman" that runs this site apparently considers posting positive information "spam" and removed it.
As Richard said, you weren't singled out. Your intention in posting was to promote your financial product and this thread is not the place to do it. You are welcome to provide positive information about your company and product, you simply must do it in the appropriate place.
Prior to your post, you had 0 posts on the forum. Had you been an active participant on the site prior, we would likely have moved your post to the appropriate place, however, as it was your first and only post, we removed it. Too often people come to the site with the intention of posting promotional SPAM and we won't stand for it.
As for me being a "gentleman," if you have an issue with me directly, it would have been much more "lady-like" to address it privately instead of attempting to besmirch me publicly. There is no need to be nasty to me in this matter, whatsoever.
Now that the entire thread has been hijacked, lets try to return to the conversation about Money Merge Accounts.
this product is not software, it is just access to a web based program. i truely believe that if benevolence was the key to this program, it wouldnt cost $3,500.
Thanks for the clarification Richard and Josh...
I apologize if you feel I violated your rules... I read the rules before I posted and in no way did I think that what I posted was an "advertisement" or solicition at all.
I felt that my post WAS "contributing," since I was answering a direct question/request for more information AND I was simply notifying people of available, credible, 3RD PARTY, independent information.
My post was NOT my personal opinion, nor did it contain "sales" type information, such as benefits, features, etc.
It was simply pointing out which independent 3RD party sources there were that someone could go to to obtain an objective view point, or opinion.
In response to the statement that the only people "endorsing" the program were agents...
In addition to the 3 financial publications, I also mentioned (didn't I?) that a TV station (consumer reporters) also did a story on United First and gave it a "thumbs up" and a recommendation.
Surely folks don't think this network TV station is an "agent" of United First Financial? How about the financial magazines?
Anyway... I apologize if I misunderstood the rules, but I think that the definition of "spam" here is overly broad.
Best wishes...
Sue :D
UPDATE with accurate info on UFIRST (hope this is not considered spam as it is addressing two inaccuracies on this same thread).
A correction to Andrew. The United First Financial(tm) program IS software... along with lifetime client support.
It also has nothing to do with "foreign exchange rates" as two other folks incorrectly assumed.
The software was just upgraded actually a few months ago (it is constantly subject to R&D).
It now can manage MULTIPLE mortgages and focus on whichever mortgages or debts the client chooses.
It will help an investor build a RE portfolio faster.
It also acts as a great tool for doing work-ups of potential investment properties. One of our clients who regularly invests in real estate said that it took them less than 2 hours to analyze 4 investment properties.... a task that they said used to take them 1 to 2 days to complete.
This program is a cash-flow management tool... and acts like a "Financial GPS" system... looking for the quickest way to zero debt, paying the least amount of interest.
The ONLY thing we get asked from people who actually look at the DEMO version of the program and take the time to learn what this is about is...
Couldn't I just do this myself?
The answer is "yes" but not likely. Why "not likely?" Because most people simply don't have the time, or the discipline, to stick with this and you gotta assume "human error" in doing it yourself... a software program will always be more accurate.
The statistics on "discipline" are this...
Only 5-10% of people will stick to a financial plan beyond the first year.
But... after almost 5 years of history with the Money Merge Account(tm) program... 95% of our clients are "sticking to" this program.
Why? Because it takes so little time (less than 10-20 minutes a month), and because it has so many "instant" feedback tools that it MOTIVATES people.
Our average client gets 20% better results than initially projected in their Analysis.
The success of these mortgage elimination programs depends upon your having additional discretionary income every month. For example if you have $5000 in monthly income and $4000 in monthly expenses, then you have $1000 in discretionary income.
The mortgage elimination program channels your discretionary income into your loan so that you reduce your loan balance faster. The more you contribute to debt reduction, the faster you eliminate your mortgage debt. The program works especially well if you have a lot of revolving debt too. By paying off your credit cards, you will have even more discretionary income available to reduce your loan balance.
The programs work even better if you budget your monthly expenses, find ways to reduce your spending and eliminate wasteful spending habits. The result is even more discretionary income to put toward your debt reduction. This you have to do on your own. The mortgage elimination programs won't do this for you.
The programs generally promise to pay off your 30 year mortgage in nine to eleven years.
Instead of paying anywhere from $500 to $4500 to enroll in one of these programs, you can probably achieve the same results by just adding extra money to your monthly mortgage payment. For example, I had 27 years left on my mortgage loan. I played with the amortization schedules and discovered that I could retire my mortgage in just ten years by contributing an additional $800 toward the principal balance each month.
I will achieve the same result as the mortgage elimination programs without paying a program setup fee, purchasing software, without refinancing my primary mortgage and without paying interest on a HELOC, and without financing my lifestyle on credit cards.
Of course, if I want to pay off my mortgage any faster, I could always apply more discretionary income to my monthly loan payments.
BTW, I figured out how fast I could pay off my mortage under the MMA approach. I have not purchased their program, so I built amortization schedules for my mortgage loan using as much of the technique that I could detect from a demo of their system. According to my calculations, their program paid off my mortgage loan 4 months faster than my approach.
The basic technique for the mortgage elimination programs I have looked at is to borrow 12 to 24 months of your discretionaly income from your HELOC account and apply that money in a lump sum to your mortgage balance. The idea is that this large payment reduces your loan term so that you "save" quite a few monthly payments over the life of the loan. Some months your living expenses will be lower, so your extra discretionary income pays off the HELOC loan even faster, and therefore, lowers your HELOC interest payment even more
If you compute the difference between the total interest you would pay on your shorter loan term with the total interest you pay on the full amortization schedule, then compare that to the total interest you would pay on your HELOC for the time it takes to complete the mortgage elimination program, you should realize a tremendous savings. In a nutshell, you are borrowing from your HELOC to pay your mortgage, incurring a higher interest rate on your HELOC than you are paying on your mortgage loan. Using a higher interest rate loan to pay off a lower interest rate loan works because your HELOC is paid off over a shorter term with the effect that the total interest paid on the HELOC is significantly less than the interest saved on your mortage loan.
If you have the discretionary income available each month, just apply it to your monthly mortgage payment as additional principal. Have your loan servicing company automatically deduct it from your checking account each month along with your regular loan payment. Use your spreadsheet program to play with amortization schedules to determine how much you would need to contribute to your principal balance each month to achieve the mortgage reduction timetable you want. Not quite as "glitzy" as the debt elimination programs, but something you can do yourself.
Setting up an automatic payment plan with your lender is something you only have to do one time, then you let the automatic payment plan do its thing until your loan is paid off. You don't need the discipline to add additional to the payment each month, it is done for you, and is something you can stick with because it takes no effort.
It doesn't have to be such a dramatic addition as $800 a month to have a dramatic effect. If you have a $100K loan at 6% for 30 years, the payment will be just under $600 (not including taxes and insurance). Adding an extra $50 to each payment will knock five and a half years off the loan. Adding $100 knocks off eight years. Doubling the payment to $1200, which is essentially all this expensive program does, will knock it down to nine years. Instead of paying the big bucks to enroll in one of these, buying software, and refinancing, just put the extra money toward the payment. If you're three years into this $100K loan, and make a one time $4000 extra payment, you knock 31 months off the mortgage and save $15,000 in interest if you do nothing else!
the down side ofcourse is that once you throw the extra money into payment (without the program), it is essentially gone unless you refi or get an equity.
time and time again, i have seen people try to pay their mortgage off at such a rapid pace that they leave themselves little to nothing to live on and end up refinancing and being talked into the most they can be put into a worst situation than they were originally in.
I'm by no means advocating this program (a couple of years ago, a friend of my wife's tried selling it to me). I'm with the majority of you all and agree that paying extra towards the principal is the way to go. However, think before you write the check :)
I think a key factor missing here is the type of person this program may or may not be good for.
For me as an investor, I look at my home mortgage as a great tax deduction against my income and very cheap money to borrow. Rather than applying additional principle payments to my 1st mortgage, MMA or otherwise, I would just assume apply that extra cash to invest in another RE investment and thus create more cash flow.
For others, a guided and simplified plan which takes little time and effort can be a Godsend to assist them with "staying the course". I have seen and utilized the MMA program. I like it, but it is not a silver bullet for everyone.
Nice to see some people being objective about United First Financials program.
Of course this program is not for everybody. This is why the company REQUIRES a detailed financial analysis before a client signs up for it. Since there is a money back guarantee we have to make sure it is right for the person.
But the software accounts for many things... liquidity, multiple properties AND... in a couple of weeks... we are launching a module called uDeduct which will track business TAX DEDUCTIONS, calculate the effect of them and the additional discretionary income they create and factor that in.
This is just another reason why people just cannot get the SAME results doing it themselves. Besides that most people just don't have the discipline to stick with it, there is no way someone would want to spend the TIME to make the multiple calculations necessary to leverage EVERY penny in the most optimal way.
Mark my words though... pretty soon this program is going to be as mainstream as "Windows" or "OS X." I can't say exactly why or when (that is proprietary information and not ready for public consumption yet).. but remember you heard it here first.
;~)
Just found this forum...hello everyone...I have been using this service for the past couple of years and it works elegantly...I did my due diligence prior to purchase and I am satisfied that there is no other system or process that will achieve the same result, and I am fairly financially savvy...just thought I would chime in...
Warmly,
Jim
Something is missing in this discussion. The opponents are not speaking to the claim the proponents make. The proponents of the HELOC plan are saying that one can pay off the 1st loan sooner WITHOUT MAKING ADDITIONAL PAYMENTS. They are saying that it is about accelerating the TIMING of the payments from checking account to the mortgage and leaving the money there until the money is needed in checking, instead of vice versa. This then lowers the average daily balance of total debt for that month. Then, when the scheduled mortgage payment is in effect LEFT IN the mortgage, it is applied to a smaller outstanding balance, thereby slashing the payoff period. They are someone can payoff the mortgage faster WITHOUT LOWERING THEIR LIFESTYLE to do it. I don't think I've heard the opponents rebut this as a viable and superior alternative to their claim that the only way to pay off a mortgage faster is to make ADDITIONAL payments to the mortgage.